Hello, good evening. Could the audience please take a seat as we are beginning the next portion of our presentation? Welcome, ladies and gentlemen, to the 41st annual J.P. Morgan Healthcare Conference. My name is Edwin Zeng. I'm a part of the healthcare team with JP Morgan. Today we're here to hear about the presentation from the Tandem Diabetes Care team. Our presenter is John Sheridan, who is the CEO of Tandem. Following that, we also have Leigh Vosseller, who is the CFO, and Susan Morrison, who is the EVP and CAO of the company. Please join me in welcoming them to the stage.
Thanks, Ed. Ed, real quick, where is the flipper for the slides? Is this it here? Okay, great. Thank you. Well, good evening, everybody. It's nice to be here. This is our first visit to JP Morgan as a public company. I just wanna start off by saying that we released the 4Q and 2Q 2022 earnings last night, and in them, We had GAAP and non-GAAP results. I just wanna state that so that as you see the results, you'll understand that. I'll start off by just saying that, you know, as a medical device company, from the very beginning, Tandem really has had uncompromised focus on user-centric design.
What I mean by that is we have engineers that study how a person interacts with the device, and our objective is to make it as simple and intuitive as possible, very user-friendly. We think that ease of use really does drive adoption in this industry. Our goal really is to have the customer focused on managing their lives and not worrying about diabetes. We are a mission-driven company. We're very focused. I mean, our priority as an organization is to improve the lives of people living with diabetes. We focus on innovation. We innovate with the hardware, the software, our user interface, and our algorithms. We also have an outstanding customer service organization that's equally important.
I think that by focusing on innovation and by focusing on customer service and really focusing on the person living with diabetes, we provide a very positive experience, which we're proud to do. We have, we participate in a very large market, and it's large, and it's also largely underserved. If you look at the U.S. market, there are 1.6 million people with type 1 diabetes, and there's 2.3 million people with type 2. Outside the U.S., in the 25 countries we belong to, there's 4 million people with type 1, and there's approximately 1.5 million with type 2. If you look at the penetration rate in the U.S. for the type 1 community, it's about 35% today. This is 35% of those people. Roughly 650,000 people use the pump.
Today, with the technologies available, the sensor, the algorithms, the automated delivering systems that are out there, our pump therapy has absolutely been proven to improve therapeutic outcomes. I mean, Time in Range substantially improves for people living with diabetes. It also improves the quality of life, and it just reduces the burden of diabetes in people's lives. So we think that as time goes on, the addition of new technologies from Tandem, from our competitors, and from our partners, is going to continue to drive interest in this technology. It's gonna continue to reduce the burden. By doing that, we expect this number in the U.S. to go from 35% today to 65% in the next five years, which is a substantial improvement in that number. In the type 2 community, we are just now getting started.
We're running a clinical study this year that'll allow us to get an indication for type 2. It's about 5% penetrated. Out of that 2 million people, only about 100,000 use a pump today. We think we can get that from 5% maybe to 10% or 15%. Similarly, outside the United States, as you can see, it's double the opportunity for type 1. We are working with the same technologies. We plan to introduce the technologies that we have in the US, OUS. We think the same logic exists there in that ease of use drives adoption. Technology really does reduce the burden of diabetes and improve the quality of people's lives. Right now in the OUS countries, it's about 5% or 10% penetrated.
In this same timeframe, we expect it to get up to about 20% or 25%. You can see this is a huge opportunity, and I think all of the players that are in the market today can benefit from this. We also believe that diabetes is not a one-size-fits-all condition, that people have different preferences. As a result of these preferences, there's many different segments out there. We're focused on providing choice. We think it's important that we provide people the option of how they control their diabetes, and basically the sensors they use to control the diabetes as well, the algorithms that they use, how they wear their device. There's many, many different options that are out there. Tandem has a portfolio approach.
I'll explain that in a few minutes, but today we have one product in the market. We have a product today that's under review by the FDA. We expect that both products will be on the market this year, and another one in a couple more years. By having these different products with different sensors, with different use options, with different control mechanisms, we think we do a much better job of addressing these different segments within the community. When you look at our competitors, our competitors are really focused on linear improvement to a single device. That's a completely different strategy than ours.
We think these other devices have a use in the market, and they are effective at serving some of the segments, but we believe a portfolio approach is a lot more effective in driving market growth. Over the last couple of years, our product launches have really driven our growth. What you can see here is this is our revenue growth curve since we began in 2012. You can see that as we've introduced new products and new technologies, we've really had a substantial effect in that. In the last four or five years, we've just grown very rapidly as we've brought the most technically advanced products to market. We have a history of innovation. This innovation is something that we've done extremely well.
You can see that over this timeframe, we've introduced roughly seven or eight products. If you look at just innovation from the history of firsts, we are the first to develop a rechargeable product. We are the first to have a touch screen. We are the first to actually have software updatability, so we can actually change the entire functionality of the pump by giving people remote software updates. We are the first to have an algorithm that has an automatic correction bolus. We are the first to work closely with the FDA when it comes to interoperability. Most recently, we're the first to introduce a mobile device, like, the ability to control insulin boluses from a mobile device, and that this device is operating on both iOS and Android systems. We're very proud of that.
I think that if you look over the next five or six years, we have a number of also very exciting products that I'll explain here in just a moment. We think we have the best pipeline in the marketplace. We're, as I said, we're very excited about that. The first product that we've got, this is our flagship product. This is the t:slim. The t:slim, as I said, has been on the market for several years. It's the smallest durable pump on the market. It's watertight, it's rechargeable using a micro-USB port. You can update the software remotely, and that's a hugely important aspect. We develop new software capabilities. We develop algorithms that automate insulin delivery that again, reduce the cognitive burden of diabetes. As long as you're in warranty, we give those away for free.
All you have to do is plug your pump into a computer at your home, and you can download that software, and you can also get training at the same time. This is a huge incentive for people who are currently using our product and warranty. They recognize that they've got access to our pipeline over time. Because of that, there's a huge incentive to continue to renew and use the Tandem pumps in time. We also have the most advanced algorithm in the marketplace today. It's called Control-IQ. This is a hybrid closed-loop system. What it does is basically has a sensor. We partner with Dexcom on the sensor. The sensor feeds the blood sugar information to an algorithm which looks out 30 minutes and decides whether your blood sugar is going up or down.
If it's going up, the system will give you a little bit more of basal insulin. If it's going up at a higher rate, it'll give you an automated correction bolus. If it's going down, it'll attenuate insulin, and if it's going down rapidly, it'll actually suspend insulin. The benefits of this technology is you have immediate and sustained improvement in your blood sugar control when you start to use this device. You see that people's Time in Range substantially improves. Again, they're able to spend less time managing their diabetes and spend more time playing with their kids, just basically managing their lives. As I said, this device has the trust and confidence of the physician community. It's believed to be the best technology in the market today.
We've accumulated a significant amount of data on the device. We have 100 million patient days of data that we accumulate from all of the people using it today. This data, obviously, can go into future product improvements and go into the analysis of how the device performs in studies and a number of different means that basically help us advance the technology. Just one second. Tandem Mobi is the device that we have under review. You can see here, wearing it here. Tandem Mobi is half the size of t:slim. It doesn't have a touch screen interface on it. It's controlled entirely by a mobile app. The beauty of Tandem Mobi is it's very discreet, and it's also very convenient.
By using a mobile app, you can be interacting with your device and nobody knows you have diabetes. That's a very significant advantage that this device has. You can see by its small size, you can locate it in a variety of different locations. We have a patch, you can adhere it to your abdomen. There's a lot of big advantages. It's, again, it's waterproof, it's rechargeable. On this device here, all the software updates will occur wirelessly. It's compatible with a very small infusion set, and so it's got great advantages. It's under review right now by the FDA. We have got questions. We're working with them. We're getting great responses and feedback from the FDA, and we expect that, you know, we'll have these things here taken care of shortly.
It's also an opportunity for us to improve gross margin. When you look at the, our goal is to get to a 65% gross margin by 2027. The way we're going to do that is we're going to continue to introduce new products. Each of these products, as we bring them to market, has a lower cost of goods. In this particular case here, the pump costs 15% less than our existing pump. The reimburse will basically be the same, and the cartridge is also less expensive. We expect this to be a very exciting product. Again, by virtue of its size, its discretion, and the mobile capability, we think it's gonna compete very effectively with products that are currently on the market. Whoops. We also have partners.
We have been working with Dexcom now for about six or seven years, and we've integrated three generations of their sensor technology. It's clearly, it's the engine that powers the information that's used by the algorithm. They have a G7 device that was just recently approved, and we're working with Dexcom right now to integrate the G7 sensor. I will say that, you know, what's happened over the last couple of years is the sensor technology has had significant uptake in the marketplace. I think today that they would probably tell you that, you know, 70% of the people with type 1 diabetes are using the sensor technology because of the benefits it provides. As Tandem, as a pump supplier and it having that integration, people start to use the sensor. They understand the benefits of it.
They see the data that they get from it. They see the improvement that it helps in managing their lives. They also see the benefits of working with a larger company. They're wearing a device now 24/7, and they're a lot more willing to consider using a pump. We definitely draft off the success that these sensor companies have. Working with Dexcom over the last seven or eight years has been a very positive thing for us, and we have a great relationship. We're currently working on their next generation sensor, which is a much lower profile. It has a faster startup time, and there's a number of big benefits that come along with that. We're working, as I said, with Dexcom. We expect to have that to market in the next one to two quarters.
We're also working with Abbott. Abbott's another significant partner. They've got another device that's different. This allows people to have choice. It provides choice to the community. There's differences in terms of how you use it, how it works. Again, there's people out there that, you know, there's 300,000 or 400,000 people in the U.S. that have type 1 that use the Abbott sensor that really become opportunities for Tandem as we integrate that sensor. Right now we're waiting for Abbott to get an indication for use in an AID system. That's something that we expect to happen here shortly. Once that does happen, we would anticipate that we would have a device on the market again in about one to two quarters following that timeframe. We recently acquired, excuse me.
We recently acquired AMF Medical. They have the Sigi Patch Pump. The Sigi Patch Pump is a low profile ergonomically designed patch. It's different than products that are on the market today. I'd say it's something that we've done a great deal of market research on. We, prior to acquiring Sigi, we have our own internal R&D efforts that have been going on for several years to develop our own patch device. We think as back to this the segmented market, we think there's definitely a need for patch devices in the market. There's people with type 2 appreciate that, and some groups with type 1 are also. This is their preference would be to have a tubeless device. We've been working on this for a while.
We've done a lot of market research on products that were in development at other companies with our own and products that are in the market. We found out that there were certain features about this device that had it score very highly amongst a group of people that were MDI, people who were using pens and needles, prime candidates for pump therapy, people that had type 1 and type 2, and people who were in US and OUS markets. The market research that we did basically showed us that this device here scored higher than any of the other devices that were either in development on the market and our own device that we were in development with.
We were in talks with Sigi to have an investment in them, and I think that after we began to see this data, that converted from basically an investment to an acquisition. We're very happy, and we're very proud of the work that we've done to get them. We think this device is incredibly compelling and very differentiated. The things about it that are unique are, first of all, it's a durable pump. It has a rechargeable pump. The pump itself, which is on the bottom here with the insulin vial in it, is a durable rechargeable device, and we would expect that to last for two to four years. The beauty of that is that in the survey work we did, we found out the environmental factors associated with these patch devices was incredibly important to people.
The fact that in some certain cases, patch devices are being thrown away every three days with batteries and circuit boards and integrated circuits on them. People, they have a problem with that. I think this durable solution really does well to resolve that. It also has a refill, sorry, a prefilled cartridge. The cartridge comes prefilled. It's very easy to incorporate into the system. It's a, again, another significant convenience factor that we've seen as we've done this research. We're still in the process. We actually haven't finalized the agreement. We expect that to happen this month. We have done a great deal of due diligence.
I can say that, you know, as a company, what we intend to do is once this diligence is done, once we have our two teams working together, is really to work as hard as we can to get this product to market as quickly as we can because we think it is compelling. I will say that the team in Switzerland, where we acquired this device from, are incredibly strong engineers. They've got a great deal of expertise in developing pumps and also in design for manufacturability. For a device like that's incredibly important. We want a high yielding, highly reliable device that has another opportunity to enhance our gross margin in time. I think we're absolutely getting that with this team. I think that they're gonna be a great asset to the company over time.
One of the real highlights of the quarter, this past year has been renewals. The way renewals work, in the event you don't know, is that we sell a pump, and it's in warranty for four years. While it's in warranty, we will service it, we will give you free software updates. You can see here that these are the sales numbers that we've seen since 2012, and these are actually annual shipments. What we've done really is we've built a team internally, and we provide a number of incentives to people who have a current Tandem pump, so that once they exit the warranty period, they will purchase another Tandem pump.
We also have spent a lot of time on customer service and things like that really do create this positive experience, which we think is why people come back to Tandem. We've been very happy with the performance. Over time, we're seeing an increasing number of people renew faster. It doesn't happen within the four years. It takes on average about five years, but the percentages are going up, and this becomes a meaningful part of our growth strategy going forward. As you can see here, in 2019, these people here are candidates for the renewal opportunity this year in 2023. In 2018, that was approximately 30,000 people in the U.S. In 2019, that's about 50,000 people in the U.S., plus a meaningful number from our OUS countries.
This revenue stream becomes important going forward and a significant part of our growth going forward, and that's why we focus so much time on incentivizing the people who are currently using the system, providing great customer service. You can see here the benefits and time continue. With the investments that we made recently, clearly there's going to be pressure on OpEx. We have definitely, you know, increased our R&D spending, and this year in particular, with two acquisitions that we've made this year are gonna pressure OpEx. I will say that we are a growth company, and we intend to continue to invest in R&D innovation. We think that's basically the way we've gotten growth.
As you can see back in that other slide I showed you, as we introduce new products, that's really where the growth comes from, and we expect to continue that. I will also say, though, that we recognize that, you know, we need to be very careful about spending. We have been looking for opportunities in the organization to be careful about how we spend so that we can continue to be profitable, continue to have a favorable adjusted EBITDA throughout 2023 as we do experience this pressure. That's one of the things that the organization is really working on. I think that just more to sort of wrap it up, I think we're very excited about our position in the market.
We clearly have had some pressures this year from COVID, from macroeconomic factors and for competition. You know, our growth curve is not gonna be linear. You know, when there's when there is these factors going on, it's gonna moderate, but we have an exciting future. We have exciting products. I think we've got the absolutely most exciting pipeline in the industry. I think with that, we expect to see us return to the kind of growth curves that we've seen in the past. As I said, though, it's a worldwide market that's large and under-penetrated. We currently have the best-in-class product, and I think we have the most exciting pipeline. We have 420,000 people currently using our device in 25 countries.
I just mentioned the scaling renewal opportunity, which becomes an increasingly important part of our revenue stream as we go forward. Again, we have this portfolio of products that I think are very exciting. I know that, you know, we've studied the market carefully. We've studied the preferences that people have for these devices, and we expect that this is really gonna add value to the growth of the company going forward. As I said, we're committed to growth, and we're committed to R&D. This is the non-GAAP reconciliation for our revenue. I'll point out that I'll just go through the non-GAAP numbers. In the fourth quarter, we had revenue of $224 million. Our annual revenue was $805 million, which was at the high end of our range for the year.
We had, as we just said, 420,000 people who are currently in warranty customers of ours, and we reaffirmed our growth for 2023 at 11%-12%. That is all I had. I think from now what we can do is probably sit down and answer some questions that either Ed will have or you guys might.
All right. Thank you, John. Let's give another round of applause. We're beginning our Q&A portion of the presentation. Please raise your hand so we can direct the mic to you when you ask the question.
My first question is regarding the renewal rate you have seen so far for the users before, let's say, four years ago. Because in the recent quarter, I saw another competitor, they reported their new customers like 60% from the competitors and 40% from MDI, which like changed the mix from previous 80% to 20%, I think 20% to 80%. I just want to check what's your renewal rate so far?
Sure. When you think about renewals, what we experienced in 2022, even in the challenging market environment, was that there was no disruption in our renewal rates. In fact, when we compare 2022 to 2021, our renewal rates actually improved. When I say rate, we look at a number of different ways to calculate it, and we're really focused on getting any population to a 70% rate over time. As John mentioned earlier, that usually takes five years rather than the four-year warranty cycle. What we've been really watching this year very closely is what does that renewal rate look like after 30 days, 60 days, 90 days, because of the environment that we're in.
Like I said, it's been, very strong, improvement over last year and consistent through the end of the year.
Thank you. That's a good presentation. Question about how we think about the type 1 versus type 2 as an opportunity for you to expand. Do you see the disposable pump versus the tier pumps? How you see the patients trend? Because they will have more power to say when they choose the different brands, right? The other one is because the CMS is proposing for the basal patients coverage for CGM. Do you see any opportunity for the pump, say, your Mobi pipeline, to address the opportunity for the basal patients? Is basal pump a good idea? What kind of the characters you think it could have? Sorry, it's a bit a lot.
Yeah. On the type 1, type 2 question, I would say that the majority of our sales today occur with type 1, excuse me. There's about 20,000 people who use our technology off-label. We have, we have the pump and the algorithm, and the algorithm is only approved today for use with type 1. We are engaged in clinical studies. We've finished a sort of a safety study already. We're working with the FDA as we speak, to define a pivotal study that'll enable us to change that indication for Control-IQ to be used with type 2. We expect that study to start this year, probably approval sometime in 2024. I think that when you look at the type 2 community, we believe that, again, convenience and discretion are hugely important.
We think that, you know, Mobi is gonna be a very interesting product for the type 2 community. We definitely are interested in pursuing that in the U.S. and all U.S. countries. I'll say it's a different sale, though. It's more complex. There's a lot more involved in understanding the patient and understanding what their needs are. I think it's definitely an opportunity that we intend to pursue fully.
I think there was a second. Let me just. The second question. The basal. You know, I would say that it's new. I mean, it's not something that we would pursue, at least at this point in time. We have a very exciting pipeline that doesn't include it. I would say that if, you know, we'll have to wait and see how it works out with the groups who are considering a basal-only pump. I think it's early to say. It's early to say for us. We have a pipeline that we're happy with and, you know, I don't think at this point we intend to go in that direction.
I think there was a reimbursement component to that question as well. From the type two perspective, when you talk to the commercial plans, the pathway to get someone approved for a pump is much more streamlined and more similar to the type one community. From a CMS perspective, though, there's still some significant barriers to getting someone onto a pump who's living with type two diabetes. There's a coalition today that's working very hard to change those dynamics and remove some of those enhanced requirements, so it'll be easier to get someone prescribed for a type two patient on a pump.
Great presentation, John.
Thank you.
Right here. Curious, you're gathering a lot of real-world data with the use of your mobile app. Any plans you can share about how you might leverage some of that data in the cloud, either with payers or for competitive differentiation that you could provide?
Yeah. I'd say that's a, it's a great question and it's a great point. First of all, what I'll say is that the way the mobile app works today is it takes the data, it goes directly to the cloud on not real-time, but on a roughly an hourly basis. We're populating the cloud frequently with all the data. Not everyone who has our product today uses it, but there's a substantial portion, you know, probably over 100,000 people are using the mobile device today.
The benefit is that when you go in to see your endocrinologist, you know, if you don't have data uploaded into the cloud already, typically one of the elements of the process steps they have to take is they have to download your pump, which is time-consuming, it's using the administrative organization to do things that they don't necessarily need to. It's a real benefit to the physician's organization to have that data uploaded in the cloud. The second point, relative to sort of on a competitive basis, we probably have more data than anybody in the industry when it comes to the data we have on how the system operates. We have an algorithm development team that studies it. They're looking at it.
They look at exactly how the system performs, what the results of the people who are using it are, and we're using that data to drive further improvements in the algorithm, which are things that we have staged out in time. I would also say that, you know, one of the things that we know happens is that there's a substantial reduction in adverse events when you use Control-IQ. You know, when you look at the payer organizations, a significant portion of their expense comes from unexpected hospitalizations and ER visits. It's a big number. We think that by reducing adverse events, it's correlated to these visits, and therefore, there's a substantial reduction in their expenses when they use our product as well.
We have dashboards right now that actually look at the payer organizations and every single person they've got on our pump in their organization. We're sharing that with these payers. We aren't at the point yet where they're actually sharing their data back to us, but we expect that we'll get there. When they do see that, we think that what we'll be able to do is we'll be able to use the data to increase our reimbursement. It's basically share the benefits of the technology, share it by increasing the reimbursement for our devices. I think that's something that's a meaningful objective. Also, simplify the process for people to get in, you know, who have healthcare to get onto our pump, right?
I think that those are two things that we'd like to achieve by using this data, working with the payer organizations. I say that we're at a size right now where we have communications with the right people in these organizations, we expect that to happen here. I guess it's difficult to predict, they're large bureaucratic organizations, I think we definitely see a path to making that happen.
Sorry, me again. I have a question regarding the new Libre 3 sensor for you to integrate into your pump for the AID. For new sensor, if you want to integrate us, usually how long it will take? Because I heard different voices regarding Libre 3's vitamin C problem, and there are some doubts saying they probably will never get the FDA approval for the AID integration. Abbott doesn't say that, but I heard somebody say that. I said, just say if it gets approved this year or let's say next year, how long it will take to integrate in your system.
We've been working with Abbott now for over a year, a great partner of ours. I think they indicated today or yesterday that they have completed the data, they've completed the analysis, and they've submitted the data to the FDA for to relieve the contraindication for the AID system use. I mean, they have confidence that they're gonna be able to get past this. I mean, we don't really have any control over it, but I'm glad they're confident, and I think that, you know, we respect them. They're a very capable team and expect that ultimately they will get past that. We expect that it'll take us a quarter to two quarters after they have the contraindication removed by the FDA for us to have a product on the market.
Concerning your guidance, 11%-12% growth next year. Assuming you have, like, similar attrition rates, similar renewal rates, how much of this growth you can generate from existing customers?
Sure. What's factored into the guidance are a few different building blocks I can go through. As we look forward, we are gaining more and more revenue from what I would call recurring sources. It begins first with the 420,000 people we have in our installed base today that will be buying supplies across the year next year. As we add more customers, we'll continue to increase those supply sales. There's also our renewal opportunities. As we spoke earlier, we have a number of people who are coming up for their four-year warranty expiration. In 2023, that number grows to 50,000 people in the U.S. alone versus only 30,000 opportunities that we had in the U.S. in 2022. We have opportunity to really increase our revenue growth based on those renewal opportunities.
We still anticipate adding new patients to the customer base. Even though we've been seeing some pressure from the challenging environment this year, as we work into next year, we factor that into those guidance expectations. We really look forward to moving through 2023 and into a hopefully a healthier environment.
Leigh, maybe you could talk just a bit about how new products factor into our guidance at this point in time?
Sure. Great point, John. At this point, the 11% to 12%, you can view it as a baseline, if you will. What we did today is even though we have three new products on the horizon, we've only factored in existing products and existing environment. As new products are approved and we lay out the commercial rollout plans, then we'll be adding the upside that could come from those new products at a future date.
If you just look at the existing customers without the new customers, where would you land?
What I can say is there is a substantial step-up opportunity from renewal customers. I think you would ask about attrition rates in particular. We've seen great retention of our existing customers. We expect that the renewal rates will persist into next year, particularly as we move through the year and we start to talk about new products down the road. Even without a new product to offer today, the renewal rates have been fantastic.
Thank you. Am I up? Thank you. Thanks, John, for the presentation. I guess just to double-click quickly on the renewals, how big did the pie grow, of the total renewal opportunity in Q4 compared to the prior quarters? Secondly, I saw on the presentation under Mobi, I think it said expands channel access. Any update there? Thoughts? Okay, thanks.
Sure. In the fourth quarter, we had about 12,000-13,000 new opportunities or warranties that expired versus in the third quarter, there were only about 7,000-8,000, if I recall. Already from Q3 to Q4, we had a substantial step-up in opportunities which drove great renewal strength in the fourth quarter. In fact, we had a record renewal quarter in the fourth quarter. Again, maintaining those rates in the future, we expect to have great growth from that in 2023 and in the years beyond as the opportunities continue to escalate. When it comes to Mobi, switching to the other part of your conversation and where we think about channel access. What's important to us today is to get Mobi to market as quickly as possible.
The fastest path is to use the DME channel like we have today. Our market access team is already working with the payer community to talk about the product. You can't actually add it to your contracts until you have clearance, but we can do a lot of the legwork to make sure they understand the product, start doing the paperwork, so we're ready to execute when we have clearance. On a parallel path, we are talking to payers on the pharmacy side of the house. We're exploring what sort of opportunity may exist for Mobi in that channel. And what that means is that you have to take that conversation to a different level.
You have to get to different people in the organization who are open to innovative ideas and think about it not as a device with three components, but as a system with value that comes from the technology and the data that comes from our Control-IQ algorithm. That's something that we'll be pursuing. I would look to us launching with Mobi on DME, and we'll talk further down the road about our, you know, our success or our traction on the pharmacy side.
I'd also say that, whatever we learn on Mobi as it applies to the pharmacy channel, we'll have, you know, the ability to apply to Sigi as they come to market as well. We would expect that, you know, as time goes on, we'll be more effective at driving these newer products through this channel.
Yeah. This is a question about the tube pump and tubeless pump. someone mentioned, I heard like around these days, someone mentioned because of the existence of the tubeless, they don't see the future of tube anymore. But from your perspective, like, patients have preference. Some do want tube, and some basically don't. Let's say at the mature stage, maybe five or 10 years from now, from your perspective, what would be the divide between tube and tubeless?
I'd say that's a naive approach, whoever said that to you. I would say that there are... I mean, we have a significant number of people that they go to and they... Sort of what happens is people go to the endo office, they decide that they want a pump, and really the first decision they make is tubed versus tubeless. I think over, if you look over time, you know, over the last couple of years, it's been about 50/50. I think that the We have a friend who's also an investor and analyst, and she has a father who uses our product, and he's obviously older.
He's been using the product for a long time, and she's been trying to convince him to use a tubeless product, particularly since it's so easy to get access to those. He said, "No, I don't want it." He said, basically, he wants to be able to detach. He loves to swim. He swims in the afternoon, and he wants to be able to take his pump off to do that. The ability to detach is a huge benefit of having a tubed pump. I think that you can't detach a tubeless system from you or you lose the insulin. Being Detachability is something that's important. Another element is that we have multiple infusion sets. We have, I'm not sure, maybe 15 or 20 different SKUs that are infusion sets. We have different cannula materials. We have different cannula angles.
We have different adhesives. We have different tube lengths. There's just a variety of different options that people have that provide flexibility so that you can locate the pump wherever you want to. I mean, I think that we see that there is a need to have a tubed, excuse me, a tubeless system. That's why we're working on it. Mobi, in fact, at one point will have the ability to be tubed or tubeless. Clearly Sigi is a tubeless option. We think there's a need to have that technology out there, but by no means do we think that's all that's going to happen. We do believe that there is a going to be a long, and important need to provide tube products in the marketplace.
Thank you. I think, that's about all the time we have.
You know what? I wasn't saying you were naive. I was saying the person who asked the question made that statement was. I just wanna make that really clear. Sorry if that came across the wrong way.
Okay. Then a round of applause for our panelists. John, thank you for your time today.